Reaffirming Freedom of the Seas; W. Hawkins

WilliamR. Hawkins REAFFIRMING FREEDOMOF THE SEAS FREEDOM OF THE SEAS is one of the oldest principles of international law. It is the right to navigate through the global expanse of the oceans as one sees fit, carrying what cargo one wishes. It is also the right to extract resources from the seas by one's own efforts. Though not fully articulated until the publication of Hugo Gro tius' De Jure Belli ac Pacis in 1625, it was a principle that had been evolving since ancient times wher ever commerce flourished. It is a principle based soundly on property rights. Beyond a narrow strip of coastal waters (traditionally set by another Dutch jurist, Cornelius von Bynkershoek as three miles-the ef fective range of a 17th-century can non) the only claim to ownership is the private ownership ofvessel, cargo and equipment. No government William R. Hawkins is Assistant Professor of Eco nomics, Radford University, Radford, Virginia.

176 t'!:r claim of territoriality or sovereignty is considered legitimate. This concept of freedom was ide ally suited to the requirements of commerce and economicprogress and was the sea-going equivalent of the liberal principles of free trade and free enterprise. These three free doms provided the triad upon which European liberty and advancement was built. As Robert Gilpin has ob served in this regard: l In contrast to the cities of Asia and other continents, European cities have tended to be commercial centers rather than administrative capitals of great states and empires. As a consequence, the commercial and trading cities of Renais sance Italy, the Hanseatic League, the Low Lands and Rhineland Germany en joyed a degree of autonomy unknown to non-European cities. They became the strongholds of merchants and bankers and protected this rising class against pred atory feudal aristocracies.

REAFFIRMING FR:f~EDOM OF THE SEAS 177 It was a principle that took root early in American history and be came a basic tenet of United States foreign policy. Protection of the right of Americans to enjoy the free use of the oceans without molestation pro vided the reason for President Thomas Jefferson to send the first regular Navy patrols to the Medi terranean to combat piracy. It was the primary reason why the U.S. de clared war on England in 1812 and on Germany in 1917. Today, this principle of freedom is under attack in ways which are far more systematic than in the past when assaults were generally con fined to piracy or periods of war. To day the very basis of international law is being challenged in ways that could permanently end all individ ual rights on the oceans. Expanded Claims The threat comes in two main forms. The first is the steady en croachment of national territorial claims. In 1958, only 18 states claimed waters off their coasts be yond the standard three-mile limit, but by 1968 this number had grown to 43 nations claiming 12 or more miles. By 1978, this number had grown further to 69, eleven of which claimed territorial waters of 200 miles. The U.S. has viewed this trend with alarm for it obviously restricts movement at sea and threatens the free passage of commerce through vital straits and narrow seas which may be entire'ily swallowed up as closed national ipreserves.

The United States has refused to recognize such inflated claims. It has protested seizure of American fish ing boats off the coasts of Latin America and nas preferred to pay ransom for the ,release of such ships than to permit american captains to buy licenses which would legitimize these new territorial claims. But the U.S. has not always used merely passive methods of protest. In Au gust, 1981, U.S. Navy fighters shot down two Lib~an jets over waters which Libya c~aims but which the U.S. does not r¢cognize as anything other than opep seas. As yet, most of the coastal states that have ex tended their claims lack the means to enforce thent against determined opposition from a maritime power. Of more serlous import are at tempts to establish an international agency to who~ control of the pres ently open seal~nes would be trans ferred. Unfortup.ately, the U.S. gov ernment has b~en a party to this effort.

At the root oftthis new and serious threat is a philosophical twisting of the traditional' concept of the non territoriality of the oceans. Under this new appro~ch, anything that is not claimed byi a national govern ment must fall 'under the control of a supranational governing body, for it is inconceivable to the minds of 178 THE FREEMAN March reformers and bureaucrats that anything can fall completely out of the jurisdiction of some sort of gov ernment regulation. United NationsControl In 1965 the Commission to Study the Organization of Peace, a re search affiliate of the United Na tions Association (a lobbying group of "idealists" who work to extend the authority of the U.N.) recommended that the ownership of the oceans and their seabeds be vested in the U.N. as an alternative to the extension of territorial claims by states. With typical socialist logic, the Commis sion also concluded that the U.N.

could more efficiently develop the resources of the oceans than could private enterprise. 2 The following year, President Lyndon Johnson surprised both the U.S. and the world diplomatic com munity by describing the seas as the "legacy of all human beings," a phrase which would be modified by successive statements by Washing ton and U.N. officials to become "the common heritage of mankind"-the central term used to justify all ne gotiations on the subject since. Com mon heritage has come to imply the need for common ownership, a need to be met by some international body which will presume to speak for all mankind. Proposals followed in the United Nations, with most of the Third World hopping on the bandwagon. Vesting control of the oceans in the U.N. offered the less developed na tions the opportunity to counter what they considered to be an inequitable advantage possessed by the techno logically advanced Western states in terms of access to the seas. However, the initial reaction of the Congress was negative to such an expansion of U.N. authority. The State Depart ment, though it favored movement toward international regulation, at tempted to side-step the issue so as not to provoke a nationalistic reac tion which would halt all movement toward an agreement 3 Opposi tion also came from the Commerce and Defense Depart ments. The former sought to protect the interests of the oil industry which wanted free access to drilling on the seabed, while the latter was con cerned about possible restrictions on military uses of the oceans, particu larly as missile-equipped nuclear submarines became a vital part of the nation's deterrent force.

Common Heritageof Mankind Policy was thus blurred in the late 1960s, though trends were taking shape that would become ominous in the 1970s. On May 23, 1970, President Richard Nixon proposed that a treaty be adopted that would renounce all territorial claims to the resources of the oceans in favor of regarding these resources as "the 1982 REAFFIRMING FREEDOM OF THE SEAS 179 common heritage of mankind." The President called for the establish ment of an "international regime" which would collect revenues from ocean operations for use by the de veloping countries. This suggested regime was not to operate on the one nation, one-vote model of the Gen eral Assembly but was to reflect a balance ofinterests. 4 This statement of official policy opened a Pandora's box. In 1973, the Law of the Sea Con ference was opened under the aus pices of the United Nations to draw up a treaty in the general form out lined by Nixon. Providing the mus cle at the U.N. for the conference was the Group of 77, a bloc ofThird World nations which actually numbers 114 members. This is the same bloc which, in 1974, pushed for the Dec laration for the Establishment of a New International Economic Order.

The Group of 77 has never hidden the fact that it sees the U.N. as a device for redistributing wealth and power from the Western capitalist nations to the Third World. After eight years of negotiations, the rough form of the proposed treaty has become visible. Its centerpiece is the creation of a new supranational agency, the Seabed Authority which would be modeled on the U.N. Gen eral Assembly. It would thus oper ate on the principle of one nation, one vote and be guaranteed a per manent Third World majority hostile to the West~ The Authority would have exclusive control over the is suance of liceItses for the exploita tion of the deep seabed beyond ter ritorial waters.',The Authority would also have the power to tax compa nies engaged in ocean development, the revenues collected to go to the support of the Authority and to proj ects for Third World economic devel opment. The 4uthority would also have the powe~ to fix prices, set lim its on product~on and control the marketing of oqean resources. There would also be ptograms for the man datory transfet of technology from multinational corporations operat ing at sea to the Third World.

A Seabed Authprity The result would be the creation of a vast, unprecedented power in the hands of an international govern ment agency in! which the U.S. and other industrial countries would have minimal influence. The Authority would be self-supporting from its taxing power and would thus be largely immune from the only lever age that the Western states now have over supranational organizations: control of the pujrse strings 5 (though initially the U.$. is to provide $250 million in interest-free loans and loan guarantees in order to establish the Authority). It would be the ultimate redistributive mechanism. A Third World majority would be enthroned in a position to tax and regulate the 180 THE FREEMAN March corporate entities of the "haves" in the interests of the "have-nots." Even proponents ofthe treaty, such as Richard A. Frank who served the Carter Administration as head of the National Oceanic and Atmospheric Administration, have conceded that "even if amended by the United States, the treaty would represent U.S. acquiescence in multilateral and fairly democratic decision-making on resources and abandonment-in the first serious encounter over the new international economic order-of U.S. control commensurate with its interests as a producer, consumer and donor. The treaty would place re strictions on a previously free mar ket and require U.S. financing of a multilateral competitor."6 The multilateral competitor re ferred to is the Enterprise. The En terprise would be a supranational mining corporation established by the Seabed Authority which would operate in competition with private corporations to develop the oceans.

It would provide another source of income and control to the S"eabed Authority. It is envisioned that the Authority will require that private companies share their mining tech nology with the Enterprise and also do most of the exploration work for it. As bad as this seems, it was ini tially to have been worse. The Group of77 originally wanted to freeze pri vate enterprise out of the oceans entirely. In their proposal, the Enter prise would have been a monopoly with competition banned by treaty. It was not until 1976 that then Sec retary of State Henry Kissinger per suaded the Group to compromise and allow both private companies and the Enterprise to operate side by side. Yet, the Seabed Authority could very easily rig the game so that private companies could not compete on equal or even profitable grounds thus creating a de facto Enterprise mo nopoly. Unlimited Powers Certainly the existence of the En terprise will provide a constant temptation to the Seabed Authority to use its taxing and regulatory powers in such a discriminatory manner. For instance, despite a pro posed fee of $100,000 for a license and another $1 million per year for the right of exploration, plus addi tional fees and profit-sharing schemes should commercial devel opment begin, there is nothing in the treaty that requires the Seabed Au thority to ever grant a single li cense. If licenses are granted, one can well imagine what political terms the Seabed Authority might insist upon in addition to monetary payments.

Corporations might be required to halt trade with South Africa or Is rael or some other nation out of fa vor with the Third World majority 1982 REAFFIRMING FREEDOM OF THE SEAS 181 or be required to take on joint-ven tures with state enterprises of Third World nations. The Seabed Authority would also be a ready-made cartel. It is as sumed that the Seabed Authority would use its power to limit produc tion and control prices so as to pro tect underdeveloped nations, which presently mine minerals for export, from competition from new mining operations in the oceans. It is highly unlikely that in any of these situations the bureaucrats who would inhabit the Seabed Authority would take the side of the Western corporations. At the core of the elite which staffs the complex of interna tional organizations is, according to Richard G. Darman, a "profound aversion to unilateralism within the community of individuals (not states) involved in multilateral negotia tions." Darman was Vice-Chairman of the U.S. delegation to the Third Session of the Law of the Sea Con ference. He found that: 7 It was particularly characteristic of the Law of the Sea Conference community peopled as it is predominantly by inter nationalist lawyer-codifiers. The inter nationalist tendency to favor collective over individual actions is combined with the codifier's tendency to see the world in neat, static terms. Above and beyond practical considerations, there is an aes thetic antipathy toward the disorder of non-conformity and a general distrust of the possible benignness of self-regulat ing, dynamic processes.

This tendency of international bu reaucrats has Qeen remarked upon by others, most notably by econo mist P. T. Bauet who concluded that 8 International ~gencies have consis tently favored Third World governments who try to establish state-controlled economies and th~y have also often sup plied to these gov¢rnments personnel for running state export monopolies, state trading companies and state-run cooper atives. . .. The ihternational organiza tions also systemBiticallyattempt to unite less-developed co-pntries into a bloc in opposition to repr¢sentatives of the mar ket economy. The Seabed Au~hority would be the ultimate expression of this ten dency. Problems of Security It was intended that the Tenth Session of the Law of the Sea Con ference would b~ able to reach for mal agreement' on a treaty by the end of 1981. Hqwever, the Reagan Administration,! led by Secretary of State Alexande~ Haig on this issue, sent instructions to the U.S. delega tion not to allow!an agreement to be finalized that ye~r. The rationale for this action was.1 that the incoming Administration needed time to be come familiar wfth the negotiations and to appoint i~s own team of dele gates to the Conference. However, several factors would indicate that more than patroJ;lage was at work.

The Republican Platform adopted 182 THE FREEMAN March at the 1980 convention stated that "Multilateral negotiations have thus far insufficiently focused attention on the United States' long-term secu rity requirements" and specifically listed the Law of the Sea Conference as one of the problem areas which has "served to inhibit United States exploration of the seabed for its abundant natural resources." Fur thermore it is known that Secretary Haig is concerned with the possibil ity of a future Resource War which would threaten the American econ omy. Access to new supplies of vital resources is thus an important fac tor in the Secretary's thinking. Also the philosophical disposition of President Reagan on issues of in ternational economics is important to note. At the recent Cancun con ference, which brought together leaders from both advanced and underdeveloped nations in Mexico, the President made known his pref erence for private investment and trade and his opposition to any new international bureaucracies being created to regulate economic activ ity. Certainly something like the Seabed Authority would run counter to President Reagan's announced attitude.

There is a vast potential in the oceans. Attention has focused in the past on the drilling of oil and natu ral gas on the continental shelf. More recently attention has been drawn to the mining of manganese nodules in the deep seabeds beyond the shelf. It is believed that there may be two million square miles of shelf area where oil and gas might be found. Estimates of 500 billion barrels of oil and 1.5 quadrillion cubic feet of natural gas are not uncommon. Manganese nodules formed from manganese oxide precipitate con tain about 30 percent manganese but also nickel (1.4%), copper (1.2%) and cobalt (0.25%). While these percent ages may seem small, they become quite significant when the volume of nodules that are believed to exist is taken into account. Estimates run as high as 1,600 billion tons of nod ules in the Pacific Ocean. Nodules also are known to exist in the Atlan tic and Indian Oceans. 9 Production Thwarted The U.S. is dependent on imports for 98% of its manganese, 94% of its cobalt and 73% of its nickel. Man ganese is an important industrial metal used in steel making. Man ganese alloys are used in aircraft components and the manufacture of mining machinery, railroad track and heavy equipment of all kinds.

Presently there is no satisfactory substitute for manganese. Nickel is also an important metal for steel al loys as is cobalt. Cobalt is often used in conjunction with chromium to produce heat-resistant alloys used in jet engines. Presently, Zaire has a near monopoly on the export of co1982 REAFFIRMING FR]~EDOM OF THE SEAS 183 balt. However, Soviet-armed guer rillas have been mounting raids to disrupt Zaire's production. Even without the problems of the Seabed Authority and the Enter prise, the proposed sea treaty in fringes on ocean development. The treaty recognizes a 12-mile limit for territorial waters for all coastal states. This has been considered ac ceptable to the United States as the best limitation on territorial expan sion possible. However, the treaty recognizes an economic zone of 200 miles. In this zone, the coastal state will exercise sovereignty over all re sources, living and non-living. Free dom of navigation through this zone is still allowed, but neither fishing nor mining will be allowed without the permission of the coastal state.

While this would appear to give the United States many benefits due to its long coastlines, the advanced state of American technology is such that these· benefits· would be gained just as well under a system of complete ocean freedom. The effect of the treaty is to close off other areas or hold any investments in the conti nental shelf ransom to the capri cious and heavy-handed politics of Third World coastal states. The fundamental error in the American approach to these negoti ations has been the belief that the only alternative to the expansion of territorial claims was the creation of an international claim administered by a sup~anational body. Yet, these are not really opposite alter natives becaus~ both are rooted in the concept that the oceans can be (and/or should [be) government con trolled. Limits on Governments If we return i to the original con cept of freedolp. of the sea as ex pounded by Gr~tius we can find the source of this problem. According to Grotius, govemments could not ex ercise dominium (ownership) over property on la:~d or sea. Govern ments could ex~rcise imperium (sov ereignty) overpefined parts of the land and over! narrow coastal wa ters. They could not exercise imper ium over the oceans beyond. What a government cannot do in its own name, it canno~ delegate to be done by an internatiqnal agency. The Sea Conference is nothing more than a meeting of natiobal governments and cannot claim rights collectively greater than th,ey can claim sepa rately. Grotius ~ould no more have recognized the ISeabed Authority's claim to regulat~ the oceans than he would have reqognized a claim by Spain or England to do so.

This is the pfiradox. For the na tions of the wor~d to turn over to an international agency control of the oceans, they m~st first claim that control thems~lves as individual states. But once having done this, those states best able to make their 184 THE FREEMAN March claims effective would have little or no reason to turn them over to the U.N., the Seabed Authority or any one else. If territorial claims to the oceans are to be avoided, the only logical course is to return to the true meaning of freedom of the seas as understood in international law up to the present day. Safeguarding Property It is vital that a sound principle of law be articulated and enforced in regard to the seas. Commerce and fishing have always been important economic activities requiring the safeguarding of property afloat, but mining the material resources of the seabed makes such safeguards even more necessary. The amount of cap ital that will have to be invested to develop ocean mining sites is of such a magnitude that it is unlikely to attract very many entrepreneurs unless assurances are forthcoming that the mining property worked will be secure.

A maritime code recognized by the international community codifying property rights and giving legal pro tection to ocean mining companies so that they could proceed with con fidence would ,be highly desirable. Unfortunately, it would be unlikely for such a code to emerge in the cur rent environment. Certainly the proposed Law of the Sea Conference treaty does not fit this description. Operations through corporations can yield the same effects as terri torial claims in regard to the rights of property and law without violat ing the traditional freedom of the seas ban on the exercise of sover eignty. However, these concepts of private property rights which have a long tradition in Western law are alien in outlook to most Third World and socialist states. There is no prospect that the world community will come together in aphilosophi cal agreement on this matter. That is why the world community is not really a community at all. There is an insufficient body of common be liefs and values to form a true com munity.

Therefore, if mining operations are to commence in the oceans, those doing the mining will have to be as sured of their rights by the United States and other maritime nations. This could either be done on a uni lateral basis with each nation pro viding protection for the operations of its own citizens or by a convention among the maritime states. It is, af ter all, the Western maritime na tions whose citizens will be both the principal producers and consumers of ocean resources. Either alterna tive would be preferable to the sac rifice of the interests of the Western Industrial nations to a treaty and to a supranational organization domi nated by states and values hostile to capitalism. At various times during the Con1982 REAFFIRMING FREE:OOM OF THE SEAS 185 ference, American diplomats have made veiled threats to do just this. In 1978, Elliot Richardson told Con gress that "Seabed mining can and will go forward with or without a treaty .... We have the means at our disposal to protect our ocean in terests .... And we will protect those interests if a comprehensive treaty eludes US."lO As Robert W. Tucker warned in his important book The Inequality of Nations, "Either the old order will be reaffirmed by those who for the time continue to hold predominant power or a new order will be estab lished by those seeking to displace the established power holders."l1 ® -FOOTNOTESlRobert Gilpin, "Economic Interdependence and National Security in Historical Perspec tive," Economic Issues and National Security, Klaus Knorr and Frank N. Trager, eds. (Law rence: Regents Press of Kansas, 1979), p. 25.

Why Not Try Freedom? 2Edward Wenk, Jr.,iThe Politics of the Ocean (Seattle: Univ. of Washington Press, 1972), p. 259. 3Ibid., p. 267. 4Marine Science Aff(:lirs(Wash.: Government Printing Office, 1971), 5th Report, pp. 81-82. 5"While serving as a U.S.delegate to the UN (Senator Frank Church) prepared a report for the Senate Foreign &elations Committee, re leased February 20, 1~67, suggesting that the UN be made financially independent through ownership of the oce~m's mineral resources." Wenk, Politics, p. 259. 6Richard A. Frank, j'Jumping Ship," Foreign Policy (#43, Summer 1981), p. 135. 7Richard G. Darman, "Law of the Sea: Re thinking U.S. Interests," Foreign Affairs (Jan. 1978), p. 381. 8:p' T. Bauer, "Hostility to the Market in Less Developed Countries,". The First World and the Third World, Karl Br11I)Iler,ed. (New York: Univ. of Rochester Policy Center Publications, 1978), p.177.

9George A. Doumani, Ocean Wealth: Policy and Potential (Rochell~ Park: Hayden Book Co., 1973), Chapter 3. lODepartment of State Bulletin (Wash: Gov ernment Printing Offiqe,Feb. 1981), p. 57. 11Robert W. Tucker, The Inequality ofNations (New York: Basic Boo~, 1977), p. 96. IDEAS ON LIBERTY IN MOST spheres of human action, the state is already firmly established, with its vast array of rules and regulations, layers of bureaucracy, and well-established penalties for transgressors. With ,the seabed, however, the state is very late in catching on to what techn.ology is making pos sible .... The statists have had their chance: they have $pread their coercive bureaucracies over every square mile of land on e~rth. The oceans rep resent man's second chance-perhaps his last-~o solve the environ mental problems that, unchecked, threaten his ex\tinction. It is time past time-that men of integrity stood up and sai4, "Enough!" Laissez faire: hands off the sea.

ROBERT POOLE, JR., ~'The Wealth of the Oceans"